Higher Education Class Action Litigation Reaches a Boiling Point

shutterstock_572127751_blogThe past month has been a busy one for the 19 class action cases making their way through federal courts across the country.

First, the trial in Sacerdote v. NYU has concluded with a ruling expected from the judge on the case in July.

Second, in the trial of Daugherty v. University of Chicago, the University of Chicago has agreed to a preliminary settlement with its participants. The university agreed to pay $6.5 million to address allegations that it failed to monitor two investment products and paid excessive recordkeeping fees in the two plans administered by the university.  The $6.5 million settlement amounts to about 0.2% of assets controlled by the university based on the university’s 2016 5500 filings.

Last, on Friday, May 25, Judge Jorge L. Alonso dismissed the plaintiffs’ claims in Divane v. Northwestern University.  The decision was most notable because the judge denied the request of the plaintiffs to amend their lawsuit to include additional claims.  This differs from the dismissal in the University of Pennsylvania case where plaintiffs were permitted to amend their claims and refile.

So, for those of you keeping score at home, a similar claim brought against 19 universities has recently yielded:

  • 1 trial – decision pending
  • 1 settlement – $6.5 million
  • 1 dismissal (which is now on appeal)
  • 1 dismissal with prejudice (but which could be appealed by plaintiffs)

The text of the dismissal in the Northwestern case is promising. Ultimately, the judgement in the NYU case may be more interesting so stay tuned this summer as we await this decision and watch as additional lawsuits keep coming (see: Mulligan v. Long Island University and D’Amore v. University of Rochester filed within the last month). 


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